Loan Demand Back on the Upswing

Loan Demand Back on the Upswing

After reaching a 13-year low at the end of last year, mortgage applications were back on the rise last week, the Mortgage Bankers Association reports.

Mortgage applications, which include those for refinancing and home purchases, rose 4.7 percent on a seasonally adjusted basis for the week ending Jan. 17. Broken out, demand for applications for refinancings increased 10 percent over the prior week, while applications for home purchases, viewed as a future gauge of home buying, dropped 4 percent, the MBA reports.

The MBA’s mortgage application index had posted its lowest level in about 13 years at the end of last year, when the Federal Reserve announced it would be tapering its $85 billion per month bond-buying program in the new year.

However, for the last two weeks, mortgage rates have been declining. The average rate on 30-year fixed-rate mortgages fell from 4.66 percent to 4.57 percent last week, MBA reports. That marks the lowest average for 30-year rates since this past November, according to the MBA.